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Is the US Ready to Compete in Africa? Recommendations for Modernizing US Economic Policy Tools

On March 19, 2015, senior fellow and director of CGD’s Rethinking US Development Policy Initiative Ben Leo testified before the Senate Foreign Relations Committee Subcommittee on Africa and Global Health Policy at a hearing about the potential for greater US trade and investment with Sub-Saharan Africa.

From the testimony:

"The US-Africa Leaders Summit was an important moment for our relationship with this increasingly important region. While the Summit had a clear emphasis on promoting economic engagement, largely through greater trade and investment, the subsequent impact on actual US government policy and messaging has been mixed. The Power Africa initiative is a noteworthy example of where ongoing US activities are meaningful and strongly aligned with Africans’ priorities.

Congress should advance US efforts to promote economic engagement and development priorities in the region, and push the Obama Administration to do more. First, it should urge the Administration to negotiate legally binding Bilateral Investment Treaties (BITs) with African nations. Second, Congress should consider creating a US Development Finance Corporation or pursuing more modest reforms that would improve and unleash the Overseas Private Investment Corporation (OPIC). Third, Congress should pass Energize/Electrify Africa legislation that promotes US investment in the power sector and seeks to improve economic opportunities along with health and education outcomes. None of these actions entail additional budgetary outlays. Instead, they are strategic, results-based policy tools that would give a significant boost to US-Africa relations."